gistfile1.php

<?php
/*
Template Name: Reset Page
*/

get_header()
?>
<div class="wrapper">

  <?php
    global $wpdb;

    $error = '';
    $success = '';

    // check if we're in reset form
    if( isset( $_POST['action'] ) && 'reset' == $_POST['action'] )
    {
      $email = trim($_POST['user_login']);

      if( empty( $email ) ) {
        $error = 'Enter a username or e-mail address..';
      } else if( ! is_email( $email )) {
        $error = 'Invalid username or e-mail address.';
      } else if( ! email_exists( $email ) ) {
        $error = 'There is no user registered with that email address.';
      } else {

        $random_password = wp_generate_password( 12, false );
        $user = get_user_by( 'email', $email );

        $update_user = wp_update_user( array (
            'ID' => $user->ID,
            'user_pass' => $random_password
          )
        );

        // if  update user return true then lets send user an email containing the new password
        if( $update_user ) {
          $to = $email;
          $subject = 'Your new password';
          $sender = get_option('name');

          $message = 'Your new password is: '.$random_password;

          $headers[] = 'MIME-Version: 1.0' . "\r\n";
          $headers[] = 'Content-type: text/html; charset=iso-8859-1' . "\r\n";
          $headers[] = "X-Mailer: PHP \r\n";
          $headers[] = 'From: '.$sender.' < '.$email.'>' . "\r\n";

          $mail = wp_mail( $to, $subject, $message, $headers );
          if( $mail )
            $success = 'Check your email address for you new password.';

        } else {
          $error = 'Oops something went wrong updaing your account.';
        }

      }

      if( ! empty( $error ) )
        echo '<div class="message"><p class="error"><strong>ERROR:</strong> '. $error .'</p></div>';

      if( ! empty( $success ) )
        echo '<div class="error_login"><p class="success">'. $success .'</p></div>';
    }
  ?>

  <!--html code-->
  <form method="post">
    <fieldset>
      <p>Please enter your username or email address. You will receive a link to create a new password via email.</p>
      <p><label for="user_login">Username or E-mail:</label>
        <?php $user_login = isset( $_POST['user_login'] ) ? $_POST['user_login'] : ''; ?>
        <input type="text" name="user_login" id="user_login" value="<?php echo $user_login; ?>"></p>
      <p>
        <input type="hidden" name="action" value="reset" />
        <input type="submit" value="Get New Password" class="button" id="submit" />
      </p>
    </fieldset>
  </form>
</div>

<?php get_footer() ?>